Community Right to Bid

What is the Community Right to Bid?

The Community Right to Bid came into effect on 21st September 2012 .  It gives community organisations the right to identify assets they believe are of value to their community, and nominate them to be listed on the Council's Register of Assets of Community Value.

If the asset then comes up for sale, the community will be given time to make a bid to buy it on the open market. The legislation does not guarantee that the community will be able to buy the asset, it just allows them some time to prepare a bid for it on the open market.

How does it work?

Community interest groups have the right to identify a building or other land that they believe to be of importance to their community's social well-being, and nominate it to be listed on the Council's Register of Assets of Community Value.

  • If the nominated asset meets the definition of an asset of community value, the Local Authority must list it, notify the owner and the Land Registry.  The owner will have a right to a review by the council and an appeal to an independent tribunal. View our process chart.
  • Nothing further will happen until the owner decides to dispose of the asset, either through freehold sale or the grant of a lease for at least twenty- five years.  At this point, they must notify the local authority of their intention to sell. View our process chart.
  • The owner will only be able to dispose of the asset after a specified time period (known as a 'moratorium') has expired:

    The first part of this moratorium (6 weeks) will allow community interest groups to express a written intention to bid.  If none do so in this period, the owner is free to sell their asset.

    If a community group confirms an intention to bid during this period, then the full moratorium (delay) comes into operation (6 months), allowing the group time to develop its bid.  After that, the owner is free to sell to whomever they choose, and no further moratorium can be triggered for a protected period (18 months).

     What is an 'Asset of Community Value'?

 Buildings or other land within the South Somerset area where

  • Its current use (or use in the 'recent past' i.e. the past 5 years) furthers the social wellbeing and interests of the local community and
  • the continued use (or in the next 5 years) furthers the social wellbeing and interests of the local community

This could include a publicly owned building such as a community centre or library or commercial premises such as a village shop or local pub*. It could also be a piece of land which is used by the community.

 Assets of community value cannot be:

  • Residential properties and associated land
  • Land licensed for use as a caravan site
  • Operational land used for transport, and other infrastructure

Church of England property that is 'vested' in the care of the Churches Conservation Trust is exempt from the Moratorium. Churches are not subject to any other special treatment - nominations can be made in respect of any church asset, regardless of who owns it.

 What is a 'Community Interest Group'?

  • The Community Right to Bid can be used by any 'community interest group.' The Government's definition of this includes:  
    • Parish Councils
    • Unincorporated groups with at least 21 members who are on the electoral roll within South Somerset and does not distribute any surplus it makes to its members
    • Neighbourhood Forums
    • Charities
    • Companies Limited by Guarantee that do not distribute any surplus to members
    • Industrial and Provident Societies that do not distribute any surplus to members
    • Community Interest Companies

NB. detailed definitions of these are set out in the Government's Statutory Regulations on Community Right to Bid.

The group must not carry out their activities primarily for profit, and must partly or wholly re-invest any surplus in the South Somerset area or in a neighbouring authority area. District Councils may not make nominations

What is a 'local connection'?

  • The group must demonstrate that its activities are wholly or partly concerned with the South Somerset area or with a neighbouring authority (which shares a boundary) and
  • Any surplus it makes must be wholly or partly applied for the benefit of the South Somerset area or a neighbouring authority's area.

Does this guarantee that the asset will be owned by the community?

The legislation does not restrict who the owner can sell their property to, or at what price. It does not guarantee that the community will be able to take ownership of assets; it simply gives them some time to raise the funds and prepare a bid.

When can a nomination be submitted?

SSDC will consider nominations at any time during the year.  If the intended asset is already on the open market, providing contracts have not been exchanged, SSDC can still consider the nomination.

How does the community submit a nomination?

Please contact using the first instance to discuss your project. There are a number of ways in which SSDC may be able to help and the Community Right to Bid may not always be the best route for all organisations. If a group decides to go ahead, they must complete the  Nomination Form. If all the necessary information is not submitted then the Council may be unable to consider an application.

How long will it take?

SSDC will acknowledge receipt of all nominations within 5 working days.  During or after this time the Council will contact applicants for further information and discuss the nomination with the applicant.  Under legislation, SSDC is obliged to make a decision on whether or not to list the asset within 8 weeks of receiving a nomination. All nominations will be considered by the relevant Area Development Manager in conjunction with the SSDC Ward Member and Area Chairman*, and applicants will be contacted once a decision has been made.

What happens if a nomination is accepted?

The Council is bound by law to list all accepted assets on SSDC's Register of Assets of Community Value, notify the owner and notify the Land Registry. 

What happens if a nomination is rejected?

The Council will notify applicants if their nomination is not eligible and enter it onto SSDC's Register of Unsuccessful Nominations

We are able to provide a paper copy of both registers, free of charge, on request.

Can the owner request a review of the Council's decision?

Yes, owners can request a review and the Council will undertake this. The owner must request the listing review within 8 weeks of the date the Council notified the owner of the listing. The asset remains on the Register while the review is carried out, which will be conducted by the Council's Monitoring Officer. If the review results in a change in the listing the Council will notify the owner and the nominating body, including the reasons for the decision. If the asset remains on the Register after the review, the owner can appeal to an independent tribunal.

How long does an asset remain on the Register?

All accepted nominations remain on the Register for 5 years. However if the asset is sold during this time, or if the asset no longer meets the definition of 'community value' (e.g. in the event of change of use to residential), the Council will remove the asset from the Register. After 5 years, the asset is removed from the Register. If the community want the asset to go back on the register they must nominate it again using the same process as above.

What happens if the owner decides to sell the asset while it is on the Register?

The owner must give written notification to SSDC if they intend to sell the asset (sale of the asset means either the freehold sale of the property or the granting of a lease of at least 25 years). There are some exceptions to this which are listed below.

The Council must then update the Register to say that notice has been received and notify the group who originally nominated the asset. The Council must also publicise the forthcoming sale in the local area.

At this point there is an initial moratorium period. The owner is unable to sell the asset for 6 weeks (from the date the Council receives the written notification to sell), to allow time for the community to express written intention (to the Council) to bid.

This initial expression of interest must be made in writing to SSDC and can be in any format but must express that the interested group 'wish to be treated as a potential bidder for the (named) asset.'

If any written intentions are received, the Council must pass on the request to the owner at which point the full moratorium period of 6 months (from the original receipt of intention to sell) comes into force. If no written intention(s) to bid are received, the owner is free to sell the asset.

During this time the owner is able to consider any bids received.  SSDC must pass these on to the owner as soon as possible. After 6 months, they can sell the asset on the open market, and no further window can be triggered for a protected period (18 months).

Public houses -  From 6th April 2015 pubs that are listed as Assets of Community Value will require planning permission to be demolished or changed to any other use.  In effect existing permitted development rights will be removed for pubs listed as ACVs for as long as the pub is on the register.  The new regulations can be summarised as follows:

  • All pubs listed as ACVs (including those already listed) will require planning permission prior to any change of use or demolition.  This protection applies from the date of nomination and applies for the duration of the period the asset is listed (usually five years).
  • If the building is nominated, whether at the date of nomination or on a later date, SSDC will notify the developer as soon as is reasonably practicable after it is aware of the nomination, and on notification development is not permitted for the specified period.
  • SSDC has 56 days to confirm whether the pub is listed or nominated.  This means that the owner cannot change use or demolish a pub lawfully within the prescribed 56 day period.

What type of groups are able to express an interest in bidding?

Only a 'community interest group' can trigger a full moratorium, unlike a nomination which can be made by a wider range of community groups. This means only the following:

  • a Parish Council in whose area the asset lies
  • an incorporated community group which meets these definitions:
    • it has a local connection, meaning that its activities partly or wholly occur in the local planning authority area
    • it is a charity, a company Limited by Guarantee, a Community Interest Company, an Industrial and Provident Society or a Community Benefit Society

This means there is a difference between which groups can nominate an asset and which groups can trigger a moratorium. They may be completely different groups.

Is the owner obliged to sell the asset to the community group expressing an interest, or give them a discount?

No, the owner is still able to sell the asset to whoever they choose, at whatever price.

Are any types of sale exempt from the process?

Some types of disposal are exempt from the moratorium process even if the asset is listed. These are set out in the Government Guidance on the Community Right to Bid and include:

- If the disposal is a gift

- If the disposal is made between members of the same family

- If the land or building being disposed of is part of a bigger estate

-If the disposal is of a building or piece of land on which going-concern business is operating, provided that the sale is to a new owner to continue the same business (for example if an owner of a pub wants to sell the pub to a new owner, to continue running it as a pub).

Another exemption is when the owner agrees a disposal to a local community interest group, which can be made during a moratorium period. This will have been triggered by the owner notifying the local authority of their intention to sell.

 What about compensation?

Property owners who believe they have incurred losses or costs as a result of complying with these procedures can apply for compensation from the District Council. Details are set out in SSDC's Procedures for Compensation for Community Right to Bid.

 Further advice and support

For organisations wishing to take advantage of the new Community Rights listed in the Localism Act, the Government has established a range of support including funds for communities to develop their proposals. Please refer to http://mycommunityrights.org.uk/ for further information, including a dedicated advice telephone line and email enquiry service.

Pre-feasibility and feasibility grants are also available.  For more information visit mycommunity.org.uk

To enquire about this new piece of legislation or to find help to protect or develop local community assets please contact communities@southsomerset.gov.uk or 01935 462462 - and ask for the Area Development Service.

Land and buildings owned by SSDC

SSDC has an Asset Transfer Policy and this may be a more appropriate route for community groups wishing to take over the ownership and management of SSDC owned properties. SSDC also encourage the development of community owned and managed assets through grants and advice. Read more about our asset transfer policy here.

*Any nominations under the Community Right to Bid which involve SSDC-owned premises will be considered by the Council's District Executive Committee.